Dispute resolution: Swiss arbitration, London and enforcement

Chapter 12 PILA and the revision of 2021

International arbitration with its seat in Switzerland is governed by Chapter 12 of the Federal Act on Private International Law of 18 December 1987 (PILA). The Act entered into force in 1989 and gave Switzerland one of the most liberal arbitration laws of its time. Chapter 12 applies if the seat of the arbitral tribunal is in Switzerland and at least one party had neither its domicile, nor its habitual residence, nor its seat in Switzerland when the arbitration agreement was concluded.¹ Parliament revised the chapter on 19 June 2020 and the revision entered into force on 1 January 2021. The revision codified much of the case law of the Federal Supreme Court and clarified the rules on the constitution of the tribunal and the challenge of arbitrators. It introduced provisions on the correction, interpretation and revision of awards (Art. 189a and 190a PILA).² Arbitration clauses contained in unilateral acts and in articles of association are now expressly recognized (Art. 178 para. 4 PILA). Swiss state courts may also assist arbitral tribunals seated abroad in taking evidence and enforcing interim measures (Art. 185a PILA).

For foreign parties, the most visible change concerns the language of proceedings before the Federal Supreme Court. Under Article 77 paragraph 2bis of the Federal Supreme Court Act, briefs in proceedings to set aside arbitral awards, international or domestic, may now be submitted in English.³ The grounds for setting aside remain those of Article 190 PILA. They are the irregular constitution of the tribunal, a wrong decision on jurisdiction, a decision beyond the claims or a failure to decide a claim, a violation of the right to be heard or of equal treatment and incompatibility with public policy. The list is exhaustive, since Article 190 PILA permits setting aside "only" on these grounds, so that an error of fact or of law in the award is not in itself a ground for setting it aside. Parties without a domicile, habitual residence or seat in Switzerland may exclude the action for setting aside entirely by an express declaration in the arbitration agreement or a later written agreement (Art. 192 PILA).⁴

The Swiss Rules and the Swiss Arbitration Centre

The Swiss Rules of International Arbitration were first adopted in 2004 by six Swiss chambers of commerce on the basis of the UNCITRAL Arbitration Rules, revised in 2012 and again with effect from 1 June 2021.⁵ In 2008 seven chambers established the Swiss Chambers' Arbitration Institution to administer arbitrations under the rules. On 1 June 2021 the institution was replaced by the Swiss Arbitration Centre, a company in which the Swiss Arbitration Association holds the majority. The chambers of commerce, among them the Chamber of Commerce and Industry of the Canton of Ticino, retain minority interests.⁶ The 2021 rules made electronic filing the default, introduced an express provision on hearings by videoconference, required an early case management conference and revised the rules on joinder, consolidation and multiparty arbitration. They also retain an expedited procedure for smaller disputes and an emergency arbitrator for urgent interim relief.⁷

Swiss Rules arbitration is frequently chosen in the physical commodity trade outside the grain and oilseed sectors, particularly in metals, energy and steel, where no standard form imposes London arbitration. A Lugano trader contracting with a Turkish mill, an Italian buyer or a Russian or Ukrainian producer may agree on Swiss Rules arbitration with the seat in Lugano, Zurich or Geneva. The choice offers a neutral forum, arbitrators with commercial and linguistic competence, the possibility of conducting proceedings in English, Italian, French or German and a supervisory court that rarely interferes.

Notes

1. Lenz & Staehelin (Xavier Favre-Bulle, H. Wehland, Harold Frey, Martin Aebi), "International arbitration in Switzerland: a revised legal framework in 2021", 15 January 2021, https://www.lenzstaehelin.com/fr/news-insights/browse-thought-leadership-insights/insights-detail/international-arbitration-in-switzerland-a-revised-legal-framework-in-2021/ (Art. 176 para. 1 PILA: relevant time is the conclusion of the arbitration agreement). The entry into force of the PILA in 1989 is confirmed by Swiss Arbitration, "History of Arbitration in Switzerland", https://www.swissarbitration.org/swiss-arbitration/history/. ↩
2. Lenz & Staehelin (above) (adoption on 19 June 2020; entry into force on 1 January 2021; Art. 178 para. 4, 179, 180–180b, 185a, 189a and 190a PILA). ↩
3. Lenz & Staehelin (above). Federal Act of 17 June 2005 on the Federal Supreme Court (Federal Supreme Court Act, BGG), SR 173.110, Art. 77 para. 2bis ("Rechtsschriften können in englischer Sprache abgefasst werden"), applicable to appeals against both international and domestic arbitral awards under para. 1, text at droit-bilingue.ch, https://www.droit-bilingue.ch/de-it/1/17/173.110-77-82.html. ↩
4. PILA, Art. 190 para. 2 lit. a–e, https://www.droit-bilingue.ch/en-de/2/29/291-190-230.html, and Art. 192 para. 1 (waiver in whole or in part, except for revision under Art. 190a para. 1 lit. b), https://www.droit-bilingue.ch/en-de/2/29/291-192-233.html. ↩
5. Swiss Arbitration, "History of Arbitration in Switzerland" (above) (six chambers in 2004; revisions in 2012 and 2021); Swiss Arbitration Centre, "Swiss Rules of International Arbitration", https://www.swissarbitration.org/centre/arbitration/arbitration-rules/ (2021 version in force since 1 June 2021). ↩
6. Cleary Gottlieb, client memorandum on recent changes in Swiss arbitration, 17 June 2021, https://clearygottlieb.com/-/media/files/alert-memos-2021/2021_06_17-the-changing-landscape-of-arbitration-in-switzerland-pdf.pdf (SCAI ceased operations on 19 May 2021; Swiss Arbitration Centre Ltd. with ASA as majority shareholder and seven cantonal chambers as minority shareholders); Swiss Arbitration, "History" (above) (SCAI established in 2008 by seven chambers). Swiss Arbitration Centre, "About the Centre", https://www.swissarbitration.org/centre/ (supported by the Swiss Arbitration Association and "the Chambers of Commerce of Basel, Bern, Central Switzerland, Geneva, Neuchâtel, Ticino, and Zurich"). ↩
7. Cleary Gottlieb (above) (electronic submissions; remote hearings; case management conference; joinder and consolidation). Swiss Rules 2021, Art. 42 (expedited procedure, in principle for amounts in dispute up to CHF 1 million) and Art. 43 (emergency relief). ↩

For general information only. This article does not constitute legal or tax advice, does not replace advice on an individual case and creates no lawyer-client relationship. It reflects the legal position as of August 2025.